#FOMCMeeting 📌 Main decision:
• The federal funds rate remains unchanged at 4.25% to 4.50%, marking the fifth consecutive meeting without change since the cuts began in the second half of 2024.
🧾 Motivations and context
• The American economy recorded a growth of 3% in the second quarter of 2025, surprising the market after the contraction at the beginning of the year.
• Inflation, measured by the CPI, accelerated to about 2.7% (core PCE still around 2.7–2.9%), which reinforces the risk of persistent inflation.
• The labor market remains solid, with an unemployment rate of approximately 4.1%, although some indicators show slight easing.
💡 Internal divisions and central bank independence:
• There are internal divergences in the FOMC: governors appointed by Trump like Christopher Waller and Michelle Bowman advocate for immediate interest rate cuts, citing signs of economic weakness and moderate inflation.
• Other members emphasize that inflation still poses a risk and that the economic outlook requires caution.
• Despite strong political pressure — including Trump’s criticism of Fed Chair Jerome Powell and controversy over renovations at the Fed building — the institution maintains its independence.
📅 Projections and future expectations:
• In the June Summary of Economic Projections, the median expected two cuts of 25 basis points still in 2025, although seven members project no rate reduction until the end of the year.
• Most analysts and the financial market expect the first cut to come in September or October 2025, provided that inflation and employment indicators remain favorable.
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